It was only last October when we were hearing about a double dip recession, how bad things are going to get, and yet 6 months later all has been forgotten. We have magically pushed any threat of a new recession to the side, and the market sits happily, 3% away from its highest levels since 2008. In this ramp higher since October we've seen Gold and Silver take a hit. The main reason being that if things are truly better than the Fed will not have to continue printing USD and devaluing the USD. Lets not forget that the FED is not the only central bank thats been printing money. The U.K., the ECB, the Japanese are all devaluing their currencies in the hopes of sparking growth for their economies.
Devaluing your country's currency is much like a public company increasing their outstanding shares to raise capital. It is dilutive and decreases the value of each bill in circulation. With the major central banks continually devaluing their currency the only way to protect your capital is to invest in something that the central banks can not create more of and devalue, which brings us to Silver. I think Silver has better potential than Gold as far as percentage gains, or I would have included Gold as well.
Silver represents something you can hold onto, something with a finite value, an asset that can be used for trade. If the central banks continue on their printing ways, in a currency devaluation race, you need to put your money into something that will at least holds its value over time. A safe haven from the central banks. Silver.
Silver will not trade staright up or down but the trend is still up in my opinion. Currently I view it as being over sold, longer term I see a beautiful bull flag, which could portend a break out. Silver has been surging since the FED announced its unconventional policies to deal with the Financial Crisis in 2008-2009. As long as the FED keeps printing, Silver will rise and the USD will fall. It won't be long before the U.S. Treasury issues the 1 Trillion Dollar Bill.
I own the $31 weekly calls and posted them in the chat room at $.22 - $.37 today. I feel they will be good for a double, triple, or more before the week is out.